The government planned earlier to give the contract to both private and government-owned shipbuilders. Now, sources said, it was decided to give the entire four LPD contract to private players upon acceptance of their revised bids under the reworked plan.

The Indian Navy has planned four 20,000 ton LPD for induction in the next decade. India’s private manufacturers Reliance Defense and Engineering Limited (RDEL) and Larsen & Toubro (L&T) have cleared the financial and technical tests and have submitted commercial bids to the Indian defense ministry. L&T has a tie-up with Navantia of Spain and RDEL with DCNS of France.

The Navy’s proposed LPD ships will have the capacity to carry six main battle tanks, 20 infantry combat vehicles and 40 heavy trucks. Each ship is expected to carry 1,430 personnel, 470 sailors and 900 troops. The Navy expects to close the $2.6 billion LPD contract by the end of this year.

Indian Defense Ministry has assured naval forces to provide enough resources to augment the process of modernization which requires over $100 billion in the next 10 years.

“Acknowledging the various crucial requirements of the Indian Navy, Defense Minister Arun Jaitley assured Naval Commanders that the Government is working on all issues very positively and is going to increase the resources to make good the shortfalls soon,” a Defense Ministry statement said.

Due to a funding shortage, there is widespread concern within the forces over modernization plan of naval forces. Against a projection of $21.96 billion for the capital budget in 2017-18, only $13 billion was allotted from the annual budget 2017-18 for various services (Army, Navy, Joint staff, Air force, DGOF, R&D and DGQA) and only $3 billion for naval forces. Most of the naval force’s fund would be utilized to repay past contracts.

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